India’s Oil and Natural Gas Corp (ONGC) has completed the acquisition of an 80% stake in an offshore block owned by the Gujarat State Petroleum Corporation (GSPC) in the Krishna Godavari Basin for $995.3m.

ONGC will now assume operatorship of the NELP-III Block KG-OSN-2001/3 block. GSPC on the other hand will retain a stake of 10% while its partner Jubilant Offshore Drilling will hold the remainder stake of 10%.

According to ONGC, the acquisition of rights in the block align with its strategy to boost natural gas production from domestic fields at a much quicker speed, particularly with an objective to cut down on dependence on imported energy by 10% by 2021-22.

The acquisition for the Deen Dayal West Field in the block was completed following the approval from the Government of India. A Farm-in- Farm-out Agreement (FIFO) in this connection was inked by ONGC and GSPC on 10th March, 2017.

ONGC stated that it had paid in advance an amount of $200m to GSPC for future consideration of six discoveries other than the Deen Dayal West Field.

In 2014, the Deen Dayal West Field had its trial gas production while its commercial production began from 1st April 2016.

ONGC intends to develop a High Pressure High Temperature (HPHT) corridor of oil and gas in the Krishna Godavari Basin by carrying out exploration activities.

The company stated: “The Deen Dayal Field will act as a pivot in developing nearby HPHT discoveries in Yanam and Godavari PML areas of ONGC, simultaneously.

“ONGC also finds opportunity to bring the Cluster-I gas discoveries of KG-DWN-98/2 NELP Block and adjacent nomination blocks on a fast track development through utilization of infrastructure of Deen Dayal West Field.”

Last month, ONGC through its subsidiary ONGC Videsh forayed into offshore Namibia by agreeing to buy a stake of 30% in Petroleum Exploration License 0037 from Tullow Namibia.

Image: An ONGC oil and gas processing platform in the Arabian Sea near Mumbai. Photo: courtesy of Nandu Chitnis from Pune, India/